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WELL Health Technologies Announces Q2 2020 Financial Results - Q2 Revenue up 43% to $10.6 Million, Gross Profit up Sharply
Friday, August 14, 2020Company Profile | Follow Company
Shift to Telehealth Drives Record Revenue and Gross Profit in Second Quarter 2020
Vancouver, BC, August 14, 2020--(T-Net)--WELL Health Technologies Corp. (TSX: WELL), a company focused on consolidating and modernizing clinical and digital assets within the primary healthcare sector, announces it has filed its condensed interim consolidated financial statements and MD&A for Fiscal Second Quarter 2020 ended June 30, 2020.
"Q2 2020 was an exceptional quarter in which we achieved record quarterly revenue despite the challenges presented by the COVID-19 global pandemic. I am extremely proud of our whole team, especially our doctors and front-line workers who kept all of our clinics open and provided unbelievable patient care through these unprecedented times," said Hamed Shahbazi, Chairman and CEO of WELL.
Hamed Shahbazi, Chairman and CEO, WELL
"During the quarter, our telehealth program successfully allowed the majority of WELL's patient services to be carried out remotely which means that thousands of patients and physicians were able to safely meet and conduct medical consultations for all kinds of critical and non-critical medical matters. In addition, our digital EMR business continued to expand with the completion of MedBASE and Indivica acquisitions. In fact, I'm pleased to confirm that WELL now serves more than 2,000 clinics and 10,000 doctors as part of its EMR footprint. This is a very important milestone for the company."
Covid-19 and VirtualClinic+ Update:
The COVID-19 pandemic has caused an acceleration of WELL's telehealth business. Since launching at the beginning of March, WELL's VirtualClinic+ telehealth service has onboarded over 1,000 healthcare practitioners and is exceeding 1,000 virtual patient booked appointments(3) per day, often multiple times per week. Patients are increasingly turning to telehealth services to meet their medical needs while observing social distancing and self-isolation measures. The Company's publicly insured clinical revenue has proven to be robust and highly resilient as result of: (1) strong telehealth execution; (2) WELL's highly resilient family practice business; and (3) WELL's corporate-owned clinics not only remained open but also continued to support the community with an important critical service for more significant medical matters that could not be delivered as easily via telehealth.
Second Quarter 2020 Financial Highlights:
Second Quarter 2020 Business Highlights:
Subsequent Events:
Outlook:
WELL is currently experiencing a strong rebound of in-clinic physical visits due to Phase 3 re-opening of the economy, while at the same time the Company has also continued to maintain its patient volumes of telehealth consultations including continued growth and momentum behind its VirtualClinic+ telehealth program. Digital services revenue is expected to increase in Fiscal Q3-2020 compared to Fiscal Q2-2020 primarily due to the contribution from the Indivica acquisition, and the Company continues to expect the WELL EMR Group will achieve double-digit growth in 2020.
WELL's goals for 2020, which are unchanged from last quarter, are to: (i) achieve organic revenue growth in its operating businesses; (ii) continue to follow a disciplined acquisition and capital allocation strategy; and (iii) increase market share and awareness of its VirtualClinic+ telehealth service.
Selected Financial Highlights:
Please see SEDAR for complete copies of the Company's condensed interim consolidated financial statements and MD&A for the three months ended June 30, 2020.
Three months ended June 30, 2020 | Three months ended June 30, 2019 | Six months ended June 30, 2020 | Six months ended June 30, 2019 | |
$ | $ | $ | $ | |
Revenue | 10,578,144 | 7,402,271 | 20,805,144 | 14,790,314 |
Cost of clinical and digital services | (6,351,313) | (5,151,372) | (12,636,358) | (10,271,922) |
Gross Profit(4) | 4,226,831 | 2,250,899 | 8,168,786 | 4,518,392 |
Gross Margin(4) | 40.0% | 30.4% | 39.3% | 30.5% |
Adjusted EBITDA(2) | (543,015) | (556,255) | (788,947) | (894,720) |
Net loss and total comprehensive loss | (3,387,579) | (1,726,517) | (5,401,954) | (3,176,765) |
Net loss per share - for the period | (0.03) | (0.02) | (0.04) | (0.04) |
Weighted average number of common shares outstanding (basic and diluted) | 126,181,778 |
94,462,130 |
122,162,548 |
89,760,785 |
Reconciliation of net loss to Adjusted EBITDA(2) | ||||
Net loss for the period | (3,387,579) | (1,726,517) | (5,401,954) | (3,176,765) |
Depreciation and amortization | 826,168 | 395,993 | 1,554,541 | 787,175 |
Income tax | 113,356 | 85,000 | 169,005 | 85,000 |
Interest income | (85,860) | (39,823) | (175,307) | (80,626) |
Interest expense | 641,665 | 286,703 | 1,093,720 | 525,208 |
Rent expense on finance leases | (516,401) | (411,253) | (1,004,053) | (822,770) |
Stock-based compensation | 1,044,102 | 511,835 | 1,676,093 | 1,227,118 |
Time-based earn-out expense | 510,210 | 136,195 | 844,625 | 272,442 |
Transaction, restructuring, & integration costs expensed | 311,324 | 205,612 | 454,383 | 288,498 |
Adjusted EBITDA(2) | (543,015) | (556,255) | (788,947) | (894,720) |
Footnotes:
About WELL
WELL is an omni-channel digital health company that operates Primary Healthcare Facilities, is the third largest digital Electronic Medical Records (EMR) supplier in Canada and is a national provider of telehealth services. WELL owns and operates 20 medical clinics, provides digital EMR software and services to over 2,000 medical clinics across Canada and is a majority owner of SleepWorks Medical. WELL's overarching objective is to empower doctors to provide the best and most advanced care possible while leveraging the latest trends in digital health. WELL is an acquisitive company that has completed twelve acquisitions and three equity investments. WELL is publicly traded on the Toronto Stock Exchange under the symbol "WELL". WELL was recognized as a TSX Venture 50 Company three years in a row in 2018, 2019 and 2020. To access the Company's telehealth service, visit: virtualclinics.ca and for corporate information, visit: www.WELL.company.
Forward-Looking Statements
This news release may contain "forward-looking statements" within the meaning of applicable Canadian securities laws, including, without limitation: all statements in the "Outlook" section of this news release, including the Company's goals for 2020 and the intention to ramp up the telehealth program, drive efficiencies from clinics, and drive growth from its EMR portfolio; the expectation that the Cycura transaction is expected to be immediately accretive and contribute double digit EBITDA margins; and the anticipation that WDHA initiatives may allow WELL to unlock the value of its EMR and clinical assets. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, and contingencies. These statements generally can be identified by the use of forward-looking words such as "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause future results, performance or achievements to be materially different from the estimated future results, performance or achievements expressed or implied by those forward-looking statements and the forward-looking statements are not guarantees of future performance. WELL's statements expressed or implied by these forward-looking statements are subject to a number of risks, uncertainties, and conditions, many of which are outside of WELL 's control, and undue reliance should not be placed on such statements. Forward-looking statements are qualified in their entirety by inherent risks and uncertainties, including: direct and indirect material adverse effects from the COVID-19 pandemic; adverse market conditions; risks inherent in the primary healthcare sector in general; regulatory and legislative changes; that future results may vary from historical results; inability to obtain future financing on suitable terms; and that market competition may affect the business, results and financial condition of WELL. Except as required by securities law, WELL does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise.
Neither the TSX nor its Regulation Services Provider (as that term is defined in policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.
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WELL Health Technologies Corp.
Vancouver (Other Tech Sectors)
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